Cryptocurrencies

There is a mixture of hope and worry regarding the cryptocurrency industry in Nigeria. The owners declared

There has been a mixture of hope and worry regarding the cryptocurrency industry in Nigeria. Stakeholders in the sector have said the actions and policies of President Bola Tinubu’s government have left the sector in limbo over the past year.

In his campaign statement, Nigerian President Tinubu pledged to legitimize cryptocurrency and blockchain technology for the country’s banking and financial sector. The move was approved because of its potential to boost Nigeria’s fragile economy.

Opinions on Tinubu last year

However, young Nigerians are now more confused over the administration’s recent moves against the cryptocurrency industry in the country. In a statement shared with Cointelegraph, Olumide Adesina, an analyst at Quantum Economics, said there is a need for clarity and support to unlock the sector’s potential.

Adesina pointed out that recent actions, including the crackdown on peer-to-peer (P2P) trading, the arrest of a Binance executive, and accusations of currency manipulation by state officials, have temporarily shed light negative on the industry. This despite the great interest of the young and dynamic population of the country.

Nathaniel Laws, CEO of Flincap, a liquidity platform for cryptocurrency exchanges, highlighted that President Tinubu has a unique opportunity to shape Nigeria’s emerging cryptocurrency sector, just as previous leaders have done with the banking sector.

Luz said the cryptocurrency industry is maturing and it is up to President Tinubu to decide how to move forward. Luz stressed that the administration has not done enough and that more action is expected.

Crypto Policies of the Last Year

In May 2023, the Nigerian Securities Commission (SEC) issued regulations relating to digital assets, suggesting that authorities were seeking a compromise between prohibition and no regulation.

In December, Nigeria’s Securities and Exchange Commission lifted a ban on banks handling accounts of cryptocurrency service providers, and the central bank said global trends indicate the need to regulate activities virtual asset service providers, which include cryptocurrencies and assets.

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In January, the central bank issued preliminary guidelines for banks opening cryptocurrency accounts, but banks’ ability to trade or hold virtual assets within their own investment portfolios remains prohibited.

The guidelines include strict anti-money laundering (AML), know your customer (KYC) and other measures. In addition, banks must set transaction limits described as “prudent” and prohibit cash withdrawals from cryptocurrency accounts.

In May 2024, the government of Nigeria began preparing to introduce new regulations banning P2P cryptocurrency trading using the national currency, the Nigerian Naira.

review: Cryptocurrency Cleanup: How Much Is Too Much Enforcement?

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